Textiles sector looks up to Vaghela

The textile industry in the state is now pinning its hopes on the new Union minister Shankersinh Vaghela.

The industry in general is not too happy with the performance of the former textile minister Kashiram Rana, who is an MP from Surat, the hub of the state's textile industry.

The industry sees Vaghela as a leader with immense popularity among the masses and a good administrator. The textile industry feels Rana focused his efforts only on Surat while ignoring the interests of Ahmedabad's textile mills.

The industry said Rana did not ensure that larger mills and small units got a level-playing field as too many sops were offered to the small scale sector, where tax evasion and electricity theft are allegedly very high.

The industry also feels Rana did precious little to bring the benefits of the technology upgradation fund, the textile reconstruction fund, announced on February 28, 2003, and other schemes, to the industries.

There are 19 textile mills in the organised sector in Gujarat, which account for between 12 and 15 per cent of the total production of textiles in the state. The unorganised sector, comprising thousands of small scale industries, accounts for the remaining production.

By industry estimates, the small-scale units are involved in evasion of tax and electricity charges to the tune of Rs one lakh crore though the government offers various subsidies and concessions to the small-scale sector. India's share in the global textile trade is just 2.7 per cent.

"We welcome the decision to give Vaghela the textiles ministry. We feel he will address the problems of the industry more efficiently," said Abhinava Shukla, secretary general of Ahmedabad Textile Mills' Association, an umbrella organisation of large textile mills of the city.

He said the association has sought a meeting with Vaghela to discuss various issues. "What we are basically looking at is a level-playing field for both the organised and unorganised sectors. Why not bring everybody under the tax net? In the long run, it will be beneficial for all," said Shukla.

A source in the textile industry at Ahmedabad felt that Rana concentrated just on Surat, practically ignoring Ahmedabad, which is an equally important textile centre.

"We made as many as five representations between 1998 and 2000 for the textile industry, but without success. We also met state leaders, but neither politicians nor bureaucrats did something for the organised textile industry," said the source.

Shukla, at a recent seminar at the IIM, said, "What is our job? Manufacturing cloth or generating electricity? The state government has increased duty on electricity generation by captive plants, which industries are forced to put up because of shortage of power."

Ashok Shah, president of the Southern Gujarat Chamber of Commerce and Industry (SGCCI), said while Rana tried to provide an impetus to the textile industry, it has basically grown on its own.

"Whatever growth or technology upgradation has taken place in the industry, is because of individual or collective efforts of the industry itself," said Shah. He said the industry has hardly availed of subsidies or other schemes. Shah said textile units could not take advantage of the technology upgradation fund.

This because it was too complicated for them and it was beneficial only if larger sums of money were availed of under the scheme.

"Vaghela is a strong leader and we feel he will do something for the industry," the SGCCI president said.

Devkishan Manghani, vice president of the Federation of Surat Textile Traders Association, said while Rana's contribution to the industry was satisfactory, it could have been better.

"The weavers' strike and the consequent loss to the industry was perhaps a dark patch in Rana's performance. We hope that Vaghela will resolve all the problems as he is a popular and efficient leader," said Manghani.

Both the organised large textile mills as well as the small-scale units in the sector now look forward to Vaghela for addressing their pending issues.